Here’s Why Cadence (CDNS) Surged in Q3

Brown Advisory, an investment management company, released its “Brown Advisory Large-Cap Growth Strategy” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The strategy returned -0.88% (net) during the third quarter, underperforming the benchmark, the Russell 1000 Growth Index. Even though the portfolio has significant exposure to AI, its underweight to the most speculative momentum-driven parts of the trade was a headwind to performance. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Brown Advisory Large-Cap Growth Strategy highlighted stocks such as Cadence Design Systems, Inc. (NASDAQ:CDNS). Cadence Design Systems, Inc. (NASDAQ:CDNS) is a global provider of software, hardware, and other services. The one-month return of Cadence Design Systems, Inc.  (NASDAQ:CDNS) was 3.59%, and its shares gained 10.64% of their value over the last 52 weeks. On December 03, 2025, Cadence Design Systems, Inc. (NASDAQ:CDNS) stock closed at $336.11 per share, with a market capitalization of $91.49 billion.

Brown Advisory Large-Cap Growth Strategy stated the following regarding Cadence Design Systems, Inc. (NASDAQ:CDNS) in its third quarter 2025 investor letter:

“Cadence Design Systems, Inc. (NASDAQ:CDNS): Provides software services for semiconductor and electronics systems industries. Cadence (CDNS) reported strong second-quarter results, highlighted by 20% year-over-year revenue growth and nearly 30% earnings growth. Strength was broad-based across electronic design automation (EDA), intellectual property (IP), and system design, and the company raised full-year guidance. While shares initially traded down on news that its software tools could not be sold in China due to broader U.S.–China trade negotiations, the situation was resolved, allowing CDNS to resume servicing its Chinese customers. The company’s better-than- consensus expected results and a more favorable second-half outlook—despite the trade uncertainty—reinforced investor confidence in its long-term growth trajectory.”

In another article, we covered Cadence Design Systems, Inc. (NASDAQ:CDNS) and shared the list of best growth stocks to buy. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.